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Purchase Book

The Purchase Book is a specialized accounting book used to record all credit purchases of goods or materials. It excludes cash purchases, which are recorded in the cash book.

Key Features:

  • Records Credit Purchases: Only purchases made on credit are recorded in the purchase book.
  • Excludes Cash Purchases: Cash purchases are not included; they are recorded in the cash book.
  • No Posting to Ledger Immediately: Each credit purchase is posted to the individual supplier accounts in the Purchase Ledger later.

Purpose:

The purchase book helps businesses track credit purchases of goods, providing an organized record of all items bought on credit.

Format:

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Example:

If a business purchases goods worth Rs. 15,000 from a supplier on credit, it will be recorded in the purchase book as:

Date Supplier Name Invoice No. Details of Goods Purchased Amount (Rs.)
02/10/2024 ABC Supplies 456 20 units of product B 15,000

Conclusion:

The Purchase Book helps businesses organize and track all credit purchases made from suppliers, making it easier to manage liabilities and supplier relationships.

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